A rent roll is the cornerstone document for any income-producing property, offering a snapshot of current and projected rental income. Investors use it to underwrite deals, property managers to track cash flow and occupancy, and lenders to assess repayment risk.
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A rent roll is a detailed listing of every tenant in an income-producing property as of a specific date. It summarizes tenant names, unit numbers, lease terms, rental rates, security deposits, and any scheduled rent escalations.
While a Lease Abstract condenses key lease clauses and a Rent Schedule lists payment due dates, a rent roll provides a comprehensive, tenant-by-tenant financial summary critical for valuation and management.
Each line item should include the tenant’s legal name, unit or suite number, and contact information for communication and billing.
Document lease commencement and expiration dates, notice periods, and any options to renew or terminate early.
Record the base monthly or annual rent, any prepaid rent, security deposits held, and ancillary income such as parking or storage fees.
Classify each unit as occupied, vacant, or under renovation. Use color-coding or status codes to highlight leasing opportunities or problem areas.
Sum the contractual rents to get potential gross income, then compare to actual collections to identify delinquencies or concessions.
Divide occupied units by total units for occupancy percentage. Track move-ins and move-outs over time to spot retention issues.
Map out upcoming lease expirations to forecast rent roll stability. High rollover in a single period may signal income volatility.
Identify any tenant paying a disproportionate share of rent. Assess creditworthiness and diversification to mitigate default risk.
Subtract operating expenses from actual collected rent, as evidenced by the rent roll, to arrive at Net Operating Income (NOI).
Divide NOI by the market cap rate to derive value. A strong rent roll supports a lower cap rate and higher valuation.
Lenders verify rent roll accuracy against bank statements and leases to ensure rental income can service debt.
Economic vacancy measures income loss due to market-rate gaps. Lease escalations highlight future income growth.
Update the rent roll monthly or after any lease change. Implement version control to track historical performance.
Property managers collect and update lease data; accountants reconcile rent payments and produce financial reports.
Templates in spreadsheets work for small portfolios, but specialized property management software offers automation, alerts, and audit trails.
During due diligence, an investor reviews the June 30 rent roll to verify 95% occupancy across 50 units and identify current and below-market rents.
The rent roll flagged two upcoming expirations in the next quarter, revealing potential downtime if renewals aren’t secured.
By normalizing below-market rents to market rates in year two, net operating income projections rose by 7%, justifying a higher bid.
Always stress-test rent rolls for lease rollovers and ensure aggressive follow-up on renewals to protect income forecasts.
A rent roll offers a financial summary of all tenants, whereas a Lease Abstract distills key legal lease terms.
Add up payments received during the period, then reconcile against contractual rents to account for concessions or delinquencies.
Lenders focus on occupancy rate, economic vacancy, lease expirations, and tenant credit quality.
Monthly updates are standard, though major leases or turnover events warrant immediate revision.
Many firms use Excel templates, but platforms like Yardi, AppFolio, and MRI offer dedicated rent roll modules.
A rent roll is the financial heartbeat of any rental property, essential for underwriting, valuation, and management. Understanding its components and interpreting its data drives smarter investment decisions.
